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Jokowi seeks to tighten grip on state enterprises
President Joko “Jokowi” Widodo seeks to tighten his grip on key state-owned enterprises (SOEs) by reshuffling their executives and ensuring that the new appointees are able and willing to support the development agenda for his second term in office
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President Joko “Jokowi” Widodo seeks to tighten his grip on key state-owned enterprises (SOEs) by reshuffling their executives and ensuring that the new appointees are able and willing to support the development agenda for his second term in office.
Jokowi is now leading a team tasked with reviewing all SOEs and — if necessary — appointing new president directors, presidential spokesman Fadjroel Rahman said over the weekend. “The President has asserted that there is only [his] vision and mission, there is no vision and mission of ministers; the same goes for SOEs.”
Arya Sinulingga, an aide to State-Owned Enterprises Minister Erick Thohir, confirmed that the appointment of top executives at state-owned companies would only be done in accordance with the President’s vision and mission.
“SOEs are major contributors to the country’s economic growth. If the SOEs are good, then the economy is also good. Pak Jokowi has a policy that will significantly influence the policies of SOEs. This is where he’s going with his vision and mission,” Arya told The Jakarta Post on Sunday.
“Minister Erick Thohir has always consulted with Pak Jokowi regarding all things related to SOE management, including the appointment of top [executives].”
The government is currently reviewing at least five strategic SOEs: Indonesia’s largest state-owned lender, Bank Mandiri, state housing lender BTN, state-owned mining holding company Inalum, state electricity firm PLN and state energy holding company Pertamina.
All the companies except for Pertamina (now led by Nicke Widyawati) currently have leadership vacuums. Former Inalum president director Budi Gunadi Sadikin and former Mandiri president director Kartika Wirjoatmodjo have recently been appointed deputy SOE ministers.
PLN president director Sofyan Basir was suspended after being charged with graft. He was exonerated earlier this month. Meanwhile, former BTN president director Suprajarto resigned shortly after being assigned the position, citing irregularities in his appointment.
At the time, then-SOE minister Rini Soemarno approved Suprajarto's appointment despite a warning from the President that no minister was allowed to make strategic decisions, including appointing a new SOE executive.
All the top posts at SOEs would now be decided on by a final appraisal team (TPA) in accordance with Presidential Decree No. 177/2014, according to Fadjroel.
"The TPA chairman is the president, its deputy chairman is the vice president, its secretary is the Cabinet secretary and its permanent members are the state secretary, the administrative and bureaucratic reform minister and the National Civil Service Agency head," he said.
President Jokowi has recommended former Jakarta governor and Indonesian Democratic Party of Struggle (PDI-P) politician Basuki "Ahok" Tjahaja Purnama as leader of a state-owned energy company, Arya said. Rumors have been circulating that Ahok would lead Pertamina or PLN.
Erick said on Tuesday that the team had decided on names to lead Bank Mandiri and BTN. He added that it was also in the process of assessing several candidates to helm Inalum, which has rebranded itself as Mind.id.
“We’re awaiting the President’s approval. The public may expect an announcement soon."
A former minister who declined to be named has suggested that Jokowi appoint the president directors of vital SOEs by presidential decree, since they would then answer directly to the President instead of the minister.
Arya, however, when asked about that option, said he had not “received any information about it".
Center of Reform on Economics (CORE) Indonesia research director Piter Abdullah said he doubted Jokowi would use a new mechanism to appoint SOE executives, as no minister could ever do it without his blessing.
“No minister would appoint [SOE] executive themselves, including Rini," he said, adding that Jokowi might have already been notified by Rini about the appointment of Suprajarto as BTN president director.
"If the President was not happy with [her decision] then he did not show it. At the time, no appointment of SOE director was rejected by the President."
Jokowi has relied heavily on SOEs for his infrastructure drive since taking office in 2014. He is widely expected to continue that statist policy in his second term now that he has pledged faster infrastructure development to spur economic growth. (rfa)
